Philippine stocks finished lower Wednesday as the Bangko Sentral ng Pilipinas hinted of another interest rate hike in November.
The BSP raised interest rates by a total of 425 basis points to 6.25 percent to rein in inflation before pausing in the last four meetings. On Wednesday, Atlanta Fed boss Raphael Bostic said rates were already tight enough to bring inflation back down to officials’ two percent target, echoing some of his counterparts, who see a spike in Treasury yields as tempering the need to lift borrowing costs further.
Eyes will now turn to the release of US inflation figures due later Wednesday and minutes from the Fed’s September policy meeting. He added that with 10-year US Treasury yields nearly 25 basis points down from their pre-jobs data level “there is a growing sense we have seen peak rates, but significantly, investors are strongly coming around to the idea that the Fed has finally reached the end of its aggressive rate hike runway”.
“The ad hoc issuance of additional debt from the central government could provide extra policy support and more resources to re-engineer a stronger and faster recovery,” Bruce Pang, at Jones Lang Lasalle, said.